Obamacare Decision Suggests U.S. Malpractice Bill Unconstitutional

July 27, 2012 by Rob Natelson
Filed under: All Postings, ObamaCare, The Founding, supreme court 

061712  RGN ThirlmereLittle-noticed amid the commentary on the Supreme Court’s health care decision is the decision’s blow to congressional efforts to federalize medical malpractice law—a potential element of the Republican plan to “replace Obamacare.”

Medical malpractice cases, like most areas of civil justice, traditionally are judged by state courts under state law rather than by the national government. This is because, as American Founders such as Alexander Hamilton and John Marshall explained, the Constitution reserves most such matters to state control.

Yet the current U.S. House of Representatives—led by some who otherwise assail federal overreaching—have twice passed H.R. 5, a bill that would largely transfer control over medical malpractice lawsuits to the federal government. Fortunately, the measure has not passed the Senate. It is, however, being touted as part of the GOP plan to “replace” Obamacare.

Under Title 1 of H.R. 5 (the so-called HEALTH ACT), Congress would assume expansive authority over state court procedures. The bill requires state judges and juries to adopt federal standards of proof, federal damage rules, federally-mandated standards of guilt, federal statutes of limitations, and a federal schedule for attorneys’ fees that overrides agreements between attorney and client. H.R. 5 also dictates that certain legal information be withheld from juries. A portion of the bill with the Orwellian title of “State Flexibility and Protection of States’ Rights” provides that the measure overrides state law, with only minimal concessions.

Advocates of H.R. 5 claim the Constitution gives Congress authority to adopt the measure under Congress’s Interstate Commerce Power. This always has been a dubious argument, but has become more dubious in light of comments and holdings in the Supreme Court’s health care case.

The Interstate Commerce Power stems from two of the Constitution’s grants of authority to Congress. The first, called the Commerce Clause, gives Congress power to regulate interstate commerce. The second, called the Necessary and Proper Clause, grants authority to make laws “necessary and proper” for carrying out other powers, including the power to regulate interstate commerce. A close reading of modern Supreme Court cases shows that congressional authority to govern trade and insurance derives from the Commerce Clause, but that most of its other economic power (including regulating health care) comes from the Necessary and Proper Clause.

But as the Supreme Court has emphasized repeatedly, there are limits to Congress’s authority. Chief Justice Roberts’ health care opinion strongly suggests that the Necessary and Proper Clause is simply not broad enough to include the kind of control over state courts that H.R. 5 would impose.

In his opinion for the Court, Roberts upheld as a tax the individual insurance mandate. But he also agreed with a majority of the court that the mandate could not be justified under the Commerce Power. One of his key observations was that (in accordance with the Founders’ understanding) the Necessary and Proper Clause does not grant power by itself, but merely clarifies how the Constitution should be read. Roberts further explained that the Necessary and Proper Clause does not permit Congress to exercise of any “‘great substantive and independent power[s]’ beyond those specifically enumerated. . . .”

Among the “great substantive and independent powers” denied to the federal government is control over the branches of state government. Roberts wrote that laws that “undermine the structure of government established by the Constitution . . . are not ‘consist[ent] with the letter and spirit of the constitution’” and “are not ‘proper [means] for carrying into Execution’ Congress’s enumerated powers.”

In the Medicaid portion of Roberts’ opinion—in which he spoke for a seven-justice majority—he also emphasized that federal laws are void if they “undermine the status of the States as independent sovereigns in our federal system.” That principle, he said, has led the Supreme Court “to strike down federal legislation that commandeers a State’s legislative or administrative apparatus for federal purposes.” Among the cases he cited in this portion of his opinion was Alden v. Maine (1999), a prominent decision in which the Supreme Court voided a federal law ordering state courts to take jurisdiction over certain kinds of cases.

It seems clear that the Supreme Court will not tolerate efforts by Congress to dictate rules and procedures to state courts. In light of this new information, the sponsors of H.R. 5 should honor their oath to support the Constitution by promptly withdrawing the bill.

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